Elderly people affected by redevelopment projects could be resettled in the same district in future under a proposal made by the Urban Renewal Authority to retain local community networks.

The authority's chairman, Barry Cheung Chun-yuen, revealed the new measure in an interview with the South China Morning Post after finalising the authority's proposal for the new urban renewal strategy.

He said the measure had become feasible because future redevelopments would be conducted on a district-based approach, giving the authority more flexibility.

'It can't be done today as existing redevelopment projects are confined to specific sites. The degree of freedom is much greater when renewal projects are planned for the whole district,' he said.

Under the authority's proposal, affected residents and owners will be given a say in where to redevelop, revitalise, rehabilitate and preserve in their own districts. The authority can identify government sites, for example, to build rehousing blocks accommodating affected old people.

'Our senior citizens will no longer be anxious about losing their friends and connected networks when redevelopment starts,' Cheung said. People rehoused would have to pay for the flat but the authority had yet to work out the compensation scheme.

The renewal strategy has been under review since July 2008. The last stage of public consultation will end in the middle of the year. The government-appointed steering committee will prepare a report based on public views and the authority's proposal for the government's considerations by the end of the year.

While taking care of the elderly, the authority is also prepared to introduce a 'flat-for-flat' option for other affected residents, meaning they can opt for a new flat in the future development instead of receiving cash compensation. As the value of a new flat is much higher than the cash compensation currently offered to residents, which is equivalent to the value of a seven-year-flat, residents will be required to pay the difference between the two compensations.

He said the same concept was difficult to work out for 'shop-for-shop'. But the authority would help shop owners to find a suitable place to continue their business.

Steering committee member Vincent Ng Wing-shun said there was less space for ground-floor shops in new developments as the authority had to set aside areas for open space and other community facilities.

Apart from introducing more compensation options to owners, the authority will also adopt a bottom-up approach in choosing buildings to redevelop. Owners will be asked if they want redevelopment and whether the authority should step in.

'It is a revolutionary concept. Currently, the big decision has already been made without the involvement of people,' Cheung said. 'Redevelopments involve financial and human resources, why not devote the much-needed resources to where people want us to go?'

Responding to the public concerns that the authority should not partner with developers who reap profits from redevelopment projects, Cheung said the authority would introduce an option in which the authority would only act as a facilitator - matching owners with developers.

But the authority is still considering the implementation details.

'If we only act as a helper, should we still compensate the affected tenants? Should we help if the affected owners are big developers? We have to think carefully,' he said.

He did not rule out that the authority might redevelop more projects on its own, like the one in Ma Tau Wai - the redevelopment was only commenced after a tenement building collapsed in January.

'We can take it on if the project has many restrictions that look unattractive to developers,' he said, stressing the authority was the 'agent of the last resort' that should not compete with developers.

Cheung also promised to continue his commitment to more conservation projects, which often result in deficits.